Education—Student Loan Debt and the Rest

The public discussion of Biden’s student loan plan seems to be about some other country—certainly not this one.

Much of the discussion takes the point of view that Biden’s plan is a wildly-expensive and unnecessary change, since post-secondary education is functioning the way it always has.  And further the plan isn’t sufficiently targeted to the poor, so there is no point in doing it.

In fact post-secondary education in this country is so broken you hardly know where to start.  And the people targeted by the plan were so badly screwed by us that we have a responsibility to notice. 

Let’s look at the history.  The following chart is a point of departure:

It’s obvious from the chart that around 2008 something happened to the cost of college—it took off.  A prime ingredient was the George Bush’s 2008 crash, which was a double whammy:  states had less money to spend—so tuition went up—and students and their parents had less money to pay it.  As we all learned during the Covid crisis, states have limited ability to deal with new expenses, as many are prohibited from running deficits.  They need to rely on the federal government to help them out. 

However the Republican Congress blocked all stimulus (remember the “balanced budget amendment”) to provoke dissatisfaction for the 2016 election.  So there was no help to be had.   Unsurprisingly people had to take on new levels of debt.  And with Republicans continuing to sabotage the recovery, there were few jobs for these people when they graduated (or didn’t) and went immediately into arrears.  Student load debt didn’t grow because students were irresponsible, it grew because government was.

Adding to that, Republicans spent years protecting fraudulent private pseudo-educational institutions because of the supposed superiority of the private sector.  At such places you could earn a degree in “culinary arts”, for example, which was considered valueless in any real restaurant.   Essentially all students at those institutions incurred monumental levels of debt and no skills.  The worst of those have now been shut down, but Betsy DeVos did everything she could to defend them.

As a country we screwed a generation of students.  From the numbers on the chart, $10 or $20 thousand seems relevant, but assuredly not profligate. As for inflation, the risk has been exaggerated by false comparison to the stimulus packages.  The cost here is budgeted over decades; its current impact is minimal.

However we should be clear that this is a Band-Aid on a God-awful wound, because for the most part things have only gotten worse.

First of all, averaging over all institutions in the country gets a rather diverse mix of good and bad colleges. That’s appropriate for addressing needs of borrowers.  However If you want to go to a good institution to get yourself a good job, the numbers are basically twice what’s on the chart:  around $20 thousand yearly for a good public institution.   For private colleges, we can be more exact since they act as a cartel:  $80K.   Even applying to these places can cost thousands.  So much for equality of opportunity. 

What’s more the public university system, instead of being strengthened, is under attack.  That’s not just a matter of the well-publicized politization of education, bad as that is.   Public funding in many states has been reduced to the point that public colleges are admitting out-of-state (or out-of-country) students in preference to in-state ones, because they need the extra money.  That has actually become a major contributor to student loan debt!  The financial situation is so dire that colleges are spending more on administrators to raise money than on education itself.

All of that sounds like a hard problem, but as with healthcare, just about every other developed country has found a way to do it.  We need to strengthen the public system with necessarily more of a role for federal funding.  Public education has to be first-rate and affordable—and available to everyone in every state.  We’ve got to banish the preposterous model of education as a severely-limited resource with parents ready to kill to get their children into the right places!  In addition we need to limit the size of loans people need to take and be rational about the payback.  The Australian system, with payback based on ability to pay, is one working option.

It’s worth stating the obvious fact that with the current cost of education, the only way we’re keeping this country going is by importing foreign graduates (and telling them how much we hate their being here!).  We’d have to shut down Silicon Valley otherwise.  We should also be clear that when we talk about national security we’re talking not about aircraft carriers but about our national competence in key technologies.

It is also worth stressing the problem is NOT (despite rumblings from both the left and the right) that we’re sending too many people to college.  Good jobs need sophisticated training.  You can look at the government’s own (or anyone else’s) expectations of the jobs we’re going to need to fill.  Sure there should be more specifically vocational training also, but that’s not the answer to the problem we know we’ve got. Also we’ve learned from the Covid experience that online instruction is no silver bullet to replace teachers.

Finally it’s worth responding to the charge that we’re not sufficiently targeting our payments to the poor.  The fact is that the only route to equality of opportunity is making sure that there is a first-class system available to everyone.  We used to understand that.  We were the first to recognize that secondary education needed to be available to everyone.  Eventually other countries caught on, because there was a big advantage to the country in doing it.

This has been proven so many times it’s ridiculous to have to state it—education is the backbone of the strength of the country.  Despite some rhetoric, there’s nothing either left-wing or right-wing about this. Even Adam Smith knew it—he didn’t futz around wondering how little training poor people could get by with, he wanted universal literacy in the eighteenth century.  If we want to succeed as a nation, we need to succeed at education.

Propagandists for Power

This note is occasioned by John McWhorter’s piece in the NY Times, basically praising Clarence Thomas as a thinker who has been too easily dismissed.

While I agree with Mr. McWhorter on some subjects, I think he is very wrong on this one.  And his mistake is the same one made by other people about other public figures.

First about Clarence Thomas:

  • He is someone who has received help every step of his career, but who has nonetheless declared himself self-made.  His autobiography is emphatic to the point of absurdity on the subject. 
  • His general philosophy is heavily influenced by that mythology.  Like many other pseudo-self-made people (there are admittedly more rich than poor of them), he asserts “I did it, so can anyone else who has what it takes.”  No one should be asking government for help.  That he sincerely believes this does not make it either true or admirable.
  • Despite his self-delusions, he has not achieved his success as a thinker.  He has achieved success as a propagandist for power.  His ideas, however well or badly thought-out, are irrelevant to his current position.  He is a tool in the Koch organization’s (and Republican party’s) battle plan.  The position being propagated is simple and convenient:  we just don’t have to care.
  • Contrary to what you sometimes read in the papers, he has not driven the Supreme Court to its current position on the extreme right.  That is a Koch-managed and funded enterprise that has put a succession of Federalist Society judges on the Court.

We should now talk more generally.  There were places and times in the past when people seemed at least worried about selling out.  That is, whether they were putting personal advantage above some notion of morality.

We are no longer at that place or time.  In the United States (and elsewhere) today, there is no morality stronger than financial success.  People don’t need to agonize anymore, because riches are proof of morality.  That’s the Clarence Thomas problem, and he is far from the only example.

I’d even put Milton Friedman in that category (along with a good chunk of the Federalist Society).  Milton Friedman was certainly capable of understanding the logical flaw in his argument:  it’s okay to declare that corporations serve their stockholders—but only if someone else is minding the store.  If those same corporations are also running government, then no one is minding the store.  Instead he made himself a wealthy and respected genius, again as a propagandist for power.

No one should be venerating propagandists for power, no matter how sincere such people believe themselves to be.

Down with Monotheism

Monotheism amounts to an imperialistic assertion of primacy.  That sounds like one of those wild-eyed slogans from the radical left or right.  But in fact it is a simple statement of what drives quite a lot of policy, both domestic and international.

Let’s start close to home.   In both Britain and the US there is a big problem with past imperial grandeur.  The Brits just can’t get over their lost empire, and they keep doing completely illogical and crazy things (e.g. Brexit) in hopes of getting it back.  The fact that the world has changed since then, with new powers and new bases for strength doesn’t register.  Since the empire is taken to be an expression of British superiority (and of God’s grace raining down on Britain) there is no reason why it can’t just happen again.  There is only one God and he’s ours.

The US has a similar problem, just a little later in time.  We had the 1950’s and even 60’s when in the years following the destruction of the World War II the US was unquestionably the world’s only remaining superpower.  If anything we were more dominant than the British as their peak.  And we’re just as blind in looking back to it.  Our dominance was a result of national superiority and God’s grace.   We are the chosen rulers of the world and there’s nothing that ought to stop that.

The Chinese and the Russians have similar issues.  Having lived in Italy at one point, there’s more than a bit of it (going back several centuries) there too.

The Old Testament (as I understand it) had a more limited notion of monotheism:  each nation had it’s own god or gods and international struggles were also struggles of those gods.  That sounds a little more accurate.  Contemporary monotheism amounts to assertions of primacy.  An astounding percentage of Americans are ready to talk about God’s protective shield over the US and our God-given role in running the rest of the world.  That gets in the way of any notion international cooperation or any workable national objectives.  With God on your side, reality just doesn’t matter.

The Brits have already driven themselves to at least a short-term future of poverty.  It is relevant to notice—although seldom mentioned—that the pre-EO version of Britain was much slower than the continent in recovering from World War II and generally poorer per capita. 

The US is on the brink of doing the same thing.  We’ve got a dictatorial theocracy going, as well as a “we don’t need anyone” ethos on the right that denies any need to interact with the rest of the world except under terms of dominance.  Furthermore the pervasive xenophobia denies the (currently enormous) contribution of foreigners to the economic strength of the US.

However the biggest problems are not even that.  As climate change and also Covid and the Ukraine crisis show us, we have only one world.  All the national gods are going to have to cooperate if we’re going to get out of this mess.  Enough with national monotheism.

On Climate, to fight back we just need to think wider

The Supreme Court, Manchin, and the Senate Republicans have now made it much harder for the United States to do anything substantial about domestic usage of fossil fuels.  It’s hard not to get worked up about this, as the perpetrators are self-serving traitors to both our country and the rest of the world.  But that doesn’t mean there is nothing to be done.

The thing we keep forgetting is that there is only one world atmosphere.   There are other ways—beyond our own consumption—that we can use to affect the world’s climate.  It was never the case that climate was just a matter of doing our own thing.  We rich countries were always going to have to do what it takes to reduce CO2 from anywhere.   We just have to step up the effort to make sure climate is a big part of everything we do. 

I’m in no position to put numbers on this, but my guess is that we can achieve a sizeable chunk of what we say we’re losing.  The Ukraine war has already delivered given a big boost to the demand for electric cars.  We need to upgrade our electrical infrastructure to deal with the consequences—the car manufacturers are going catch up with demand.   Even if we can no longer require renewable power generation, there is a lot that needs to be done with transmission and distribution regardless. Infrastructure is necessary climate work (just like EV’s themselves or even heat pumps) though it doesn’t deliver results until the power generation change is complete.

Beyond that I’d start by focusing on our military and the Ukraine war.  Climate is after all a national security issue.   There is a lot of money authorized for both, and we need to start climate actions—foreign and domestic—associated with it.  Many people have spoken about climate backsliding from the Ukraine war, so we need to spend some of that money on compensating projects.   All of our foreign aid money—especially military (since that’s largest piece)—should be reorganized around climate.  That includes project financing and what we do about the third-world fallout from the Ukraine war.

We also need to be spending real research and development money on ways to reduce carbon dioxide production from industrial processes–not just here but in other countries such as India.

Biden has lost power to specifically address domestic usage, but it’s very important to recognize that we have other ways for the Executive to address climate issues.  We just have to start thinking more widely now.

Guns are Money

After the latest outrage of gun violence in Texas, the newspapers are full of articles about guns. However when people talk about Republicans and the gun lobby they tend to get things backwards. The gun lobby sounds like a rather limited thing, maybe financed by the manufacturers. It’s sort of odd the power they exercise over the Republican Party.

Not so odd. The reason guns are untouchable in this country is that guns are a potent identity issue used by the Kochs and the Mercers and the Thiels and the mainline Republicans to put money in their pockets. It’s core Republican money driving the gun lobby, not the other way around. That’s why there’s so much of it. The only legislative achievement of the Trump years was the monumental tax cut for the rich. Bought by guns.

Thirty years ago we didn’t have this problem with hysteria around gun ownership. It was recognized that there was a need for gun control, and there was no notion of evil liberals just looking for a chance to take away all your guns. The sense of grievance around guns was deliberately created as a means to a financial end with the active assistance Murdoch and Fox News. Why is the Supreme Court also supporting this stuff? Well all of the so-called conservatives on the Court come from the Federalist Society—which was created and managed by the Koch Organization (an indisputable fact).

Guns are money. That’s the only real story. It will continue as long as we let them get away with it. (As for what to do about it, there’s an old piece here that’s still relevant.)

Inflation

Inflation is—by common agreement—the primary issue faced by American voters today.  However when you ask people what’s causing inflation, things are quickly not so clear. 

Republicans will say immediately say that it’s all due to overspending by the profligate Democrats. Democrats will talk about worldwide trends that are beyond the scope of what the Biden administration can control.  In neither case do you turn the important issue of inflation into useful steps going forward.  That needs to be done, and we give it a shot here.  The result may be a little different than expected.

First of all inflation necessarily involves both supply and demand, and both are clearly in play here.  The Democrats’ desire to keep people whole at the end of the pandemic did put extra money in the hands of consumers., and that extra money was chasing a limited supply of available products and services.   But it also turned out that as the pandemic eased, we became conscious of all kinds of production bottlenecks that people hadn’t anticipated.  Some of those bottlenecks have gotten a lot of press, integrated circuits required for production of new cars for example.  Other bottlenecks involved consequences of Covid, such as the breakdown of daycare systems. 

The Covid payments certainly had an initial effect. However at this late date, when any Covid benefits are long-gone, the continuing pervasiveness of bottlenecks has got to be viewed as the major issue.  Car prices for example represent a third of measured inflation. What are we to make of bottlenecks persisting even now?  (Gas and food prices are now directly tied to the Ukraine war, so they are their own story.)

The most prevalent reaction has been xenophobia.  We’ve got problems because we’ve let ourselves get too dependent on the Chinese.  Bring it all home and we’ll be fine.  That sounds nice, and we certainly do have continuing problems with Chinese sources, because of their zero-Covid policies today.

But that conclusion is actually wrong. We give two examples.  One example we’ve given before:  the single worst problem during the first stage of the Covid crisis was a lack of testing equipment—because the American manufacturer with a CDC contract to produce the tests had decided they could make more money doing something else.  The second example is active today—the baby formula crisis.  Consolidation in the industry was such that a single vendor’s contaminated equipment led to a massive shortfall in supply. Without rules of fair play “our people” aren’t necessarily going to be so much better than the Chinese. Furthermore the idea that we are somehow going to deliver the best of everything available worldwide to our own businesses is manifestly false.

There are two simple facts to be acknowledged:

1.  Unbridled capitalism is simply NOT robust.  Consolidations, monopolies, and risk-blindness are private sector facts of life.  Even Adam Smith understood that.

2.  The much-expressed desire to decouple from some or all of the rest of the world is both unworkable and unproductive.

There is no substitute for solving both of these problems.  We give examples for each:

1.  The SEC has got to do a better job of making companies confront risk.  Climate change is a good example where work is underway.   Anti-trust activities are also clearly relevant. Then there is the need to limit the power of the consolidated financial sector over the companies they own.  It is established fact that companies today invest less and return more of their profits to their investors—which directly affects robustness.  What all of this comes down to is that today’s inflation is another example of the dangers of unfounded faith in a deregulated private sector.

2.  The world needs a working system of international trade so that international corporations can be transparent and effective.  The Biden administration’s work on international taxation is an important step.  Turning todays moribund WTO into an effective organization is another necessary goal.

It is most important that we stop using inflation as just one more excuse to search for scapegoats.  Even in the near term, we should be looking for more, not less, cooperation with China, as the bottlenecks hurt both countries. And in the longer term, there really are lessons from today’s inflation that can make the world a better place for us and everyone else.

The One Million Covid Victims Have a Message

At least half of these deaths were due to deliberate misinformation from political interests calling the whole pandemic a left-wing plot.  For month after month the most popular story in the Wall Street Journal was the latest reason why there was really nothing going on:  it was just like normal flu; it was worst in New York because it was only in disgusting cities full of disgusting people.

Everyone in the country suffered, including very many who bought into the party line because they thought the propagandists were on their side.  Since vaccines were coming, deaths delayed could be deaths avoided. What’s worse, almost of half the people who died were unvaccinated when they could have been, convinced by the arguments of people like the Fox hosts-who were actually vaccinated for themselves.

This Covid story is unfortunately typical of what’s happening in this country.  The “populists” are the Kochs and the Mercers and the Thiels—people with the money to fill newspapers with issues they don’t care about (abortion, guns) so they can ride them all the way to the bank.  The only major piece of legislation passed in the Trump years was the monumental tax cut for the rich.  As with Covid, the supporters drawn in with identity issues are the ones who will suffer—in jobs, healthcare, education, climate, you name it.

Taking this one step further, it is worth noting that the damage with Covid was not from action but from inaction.  Most of the endless discussions of our fractured political system are missing the point.  The country is ungovernable because they want it that way.  If government can’t act, the powers that be are running things.  As Steve Bannon put it, all we need to do is create chaos. 

This story isn’t complicated, just lost in the cacophony of bought media.

A Serious Climate Scenario

It seems to me more important than ever that we think about real scenarios for dealing with climate change.  There’s so much religion here that we can be missing the boat.  I’m going to take an extreme position in this piece, both because I think it should be on the table and because I think it’s more likely than a lot of what is taken for granted. 

I believe that fusion is going to work and be deployable in about the next ten years.  We’re going to know quite soon where that stands.  Both the Commonwealth Fusion people and Helion (among others) plan to generate net positive energy by 2025. There are also regularly new developments: more powerful magnets, longer plasma retension times, higher energies attained, even AI-based methods for controlling stability of reactor plasmas.  Higher temperature superconductors have been game-changers.  It is time to be serious about fusion.

The consequence is that we are entering (in the relatively near term) into an era not of energy scarcity but of energy abundance.  That’s not just a matter of fusion—solar, wind, and better in-network storage also contribute—but fusion represents real abundance. That’s a different mindset with different conclusions than most of what gets discussed.  I’ve argued earlier that it’s the proper mindset for the long-term, because it is the only serious way to address our worldwide problems.  The difference is that progress in fusion has been such that we can move that indefinite future to the nearer term.

With that point of view, we can view the response to climate change as two distinct issues:

– Keeping things from getting too bad in the interim while the new energy sources get up to speed.

– Deploying abundant energy to combat climate change.

It’s important to look at the second issue first, because the first (assuming we can solve it) is temporary.  The architecture for the second issue is relatively straightforward.   We’re going to have generation stations of significant size with high-capacity interconnection for distribution to users.   Electricity will be the basic form in which energy is delivered, but we’re going to have to deal with significant applications (industrial processes, air travel) where electricity itself is not the answer.  For such applications we’ll need ways to convert electricity to other forms of energy.  That may involve using electricity to make hydrogen or using electricity to achieve climate neutrality by pulling carbon dioxide out of the atmosphere for synthetic fuels. (It’s interesting that carbon capture has value even without large-scale CO2 storage.)

The most important conclusion is straightforward:  we’re going to have to vastly increase and improve the facilities to generate and distribute electricity!  That is job number one and the most essential thing to be spending money on.  Existing technology will contribute to but not solve that problem.  We also need to figure out how to move everything that isn’t currently electric onto that network.  Note that ultimately it is much less important how efficiently we use electricity than that electricity is what’s used.  We’re not getting rid of air conditioners, and we’re not making sure that every electric hot water heater has a heat pump.

As to how we’re going to survive until then, the most important message is that survival means focusing on heavy hitters.  It is not the case that every little bit helps.  I’ve given this chart before for energy use in the US:

The key sectors are transportation, industrial, and electric power—not residential.  Electric cars are clearly an important contributing technology, but even they are only an infrastructure investment until the underlying power plants are converted.

For the rest of the world, the corresponding charts can be quite different, often tilted toward industrial uses. Focusing exclusively on the US distorts the issue.   We have to get world CO2 emissions down overall, regardless of where it comes from.  This is not a question of “every country needs to do its part”.  It’s a question of the most effective way to get the CO2 total down fast

We have to think about where all the sources are and how to get at them.  Carbon pricing schemes such as CCL are particularly helpful because of their wide impact. In this country a simple calculation tells you that the current annual subsidy to fossil fuel interests is about a trillion dollars, so we’re a long way from a rational economy. Putting solar panels on suburban roof tops—however useful—is not commensurate with the problem.  Furthermore, as the following chart indicates, we rich countries need to get used to the idea of helping the others in a big way or the job will never get done!

s11_2018_Projections

As the latest IPCC report (2/28/2022) put it: “Rich governments must quickly and dramatically scale up the level of adaptation finance for low-income countries.”

Or else—there’s no getting around it—we’ll end up stuck with geoengineering and hope for the best.  Simply stated (for those who haven’t heard) geoengineering delays global warming by filling the atmosphere with chemicals that put the whole world in shade. That can stop most (but not all) aspects of climate change, but with many known and unknown risks. 

It’s hard to come to a proper judgment of geoengineering. On one hand, it’s exceedingly scary to start messing with the whole world’s atmosphere, but on the other hand we don’t yet have all the technologies we need and we’ve been slow to deploy the ones we do have, so we may well need to be buying time. One can argue that geoengineering reduces the motivation for alternative energy progress, but that work today seems to have its own motivation. So in the end there is nothing immoral about geoengineering, and we may have to use it.  But given the risks and the fact that all that extra CO2 has to come out before we can quit, we had better do as little of it as possible. (These systems require regular replenishing, so turning them off isn’t a big issue; getting rid of the extra carbon dioxide is.)

You might wonder at this point why we brought up geoenginerring instead of the much-discussed topic of carbon capture? There’s a good reason. Despite all of the publicity around it, there’s no near-term silver bullet with carbon capture. For the yearly CO2 production in the US we would need huge infrastructure of processing plants full of giant fans—a multi-trillion dollar project using enormous amounts of energy to build and run it. And that’s before you even start to talk about where to put the output. The main reason carbon capture has such prominence is that it plays to the fossil fuel companies’ delaying tactics—if we can get rid of the carbon dioxide later, why worry about creating it now? Carbon capture is a project of energy abundance, AFTER we have somehow managed to survive. Going forward, unburning everything you burn is only sensible in particular application areas (e.g. air travel) where there is nothing else to be done.

Climate change unavoidably means a huge, expensive project—which is why it is important to be clear about what we’re doing.  As general principles, conservation for conservation’s sake is wrong, a focus on local issues is wrong, and an exclusive focus on current technology is wrong.  What’s right is to recognize that the future requires an electrical infrastructure capable of driving everything and that in the near-term we have to avoid distractions and focus on heavy hitters—worldwide—to keep from going over the edge.  Near-term and long-term projects are not necessarily the same. Finally we should realize that despite our current concerns, we are actually moving toward a period of abundant energy with enormous benefits for all—if we can stop fighting over the pieces of a pie that will become much bigger.

As an analogy I remember the early days of voice over IP networks, where the whole focus was how we would ever meet the realtime performance needs of speech.  It wasn’t so many years later that those same networks were handling realtime video to hundreds of millions of people worldwide—and voice was an almost invisible blip.   That’s the kind of transformation we’re talking about.  Limitless clean energy will change the world.